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  • Archive for June 2nd, 2017

    Jun 2


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    Another new “grassroots” group has popped up to lead the split roll property tax public effort.  Grassroots is in quotes, because even though they are branding themselves as “We Are California” it is still the same old advocates that have been agitating for years to raise your property taxes – a who’s who of public employee unions and far left advocacy groups.

    The new tact is to tie the Proposition 13’s protections from your property taxes going through the roof as some sort of evil plot hatched by President Trump 40 years ago that is now just coming to fruition.  Here is the lead line in a recent email blast:

    “Donald Trump is planning to give big tax cuts to wealthy corporations and his billionaire friends. What’s worse is that he plans to pay for them with massive budget cuts to essential services — taking away healthcare, education, environmental protections, job training and even Meals on Wheels from millions of Americans. In California, thanks to a 40 year old loophole, these same wealthy corporations pocket $9 billion a year in property tax breaks, cheating our communities out of billions in investments.” –Courage Campaign/Make It Fair/Close the Loophole/We Are California email, May 31, 2017.

    Nevermind that property taxes don’t fund any of this stuff, this is no time for facts.

    This is a very organized effort to hector the State Legislature into destroying your protections under Proposition 13.  As we have reported earlier, Assemblymember Holly Mitchell (D-Los Angeles) and Senator Nancy Skinner (D-Berkeley) announced last month that they would be introducing a split roll bill, but we have yet to see the measure.

    In order to provide correct and factual information about Proposition 13 and how predictable taxes benefits small and minority owned businesses as well as California’s economy as a whole, we are members of Californians to Stop Higher Property Taxes. Click here to sign up for alerts and have access to factual information.

    Jun 2


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    Today is one of the biggest hurdles for bills making their way through the California State Legislature, House of Origin Deadline.  All bills must be out of the chamber in which they were introduced. So, both houses have had very long floor sessions to wade through thousands of measures legislators have introduced this year.  Below is a summary of some of the key measures.

    Jun 2


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    In addition to just sheer volume of bills being considered, the craziness is compounded because there are negotiations and amendments flying on many bills, so its not just a simple “up or down” vote.

    A key provision of the recently passed Proposition 54 was meant to specifically address this issue and make it easier to track changes, the so called “72 hour” rule, in which amendments are supposed to be in print 72 hours before a vote can be taken.  There has been some parsing of the meaning of the proposition and the two houses of the Legislature.

    The California State Senate honored the rule, but the California State Assembly has interpreted the 72 Hour Rule to mean the final vote in the Legislature and not this interim step.  The interpretation has drawn criticism from the proposition’s backers and derision from the Peanut Gallery noting it’s this type of game playing that brings about propositions like this.

    Jun 2


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    The good news is that we are working with legislators on a number of bills that will address industry issues for the better, and several of the highest priority measures passed this first major test.

    AB 448 (Daly D) Requires notification of property owners when parcel tax increases are proposed.

    AB 565 (Bloom D) Building standards: alternative building regulations: artist housing.

    AB 943 (Santiago D) Land use regulations and local initiatives: voter approval.

    AB 1148 (Steinorth R) Commercial property disclosures: disability access.

    AB 1515 (Daly D) Planning and zoning regulations.

    SB 71 (Wiener D) Solar energy systems.

    SB 356 (Skinner D) Energy data transparency and building benchmarking.

    SB 564 (McGuire D) Water Bill Savings Act.

    SB 711 (Hill D) Electrical and gas rates and charges.

    SB 764 (Moorlach R) Real estate trust fund accounts: fidelity insurance.

    Jun 2


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    Many bills our industry opposed and were deemed as high priorities, a majority of legislators agreed with us and they have been stopped for the year.  Note, because legislative sessions span for two years, these bills are technically known as “two year bills” as there is a chance they could move next year.  However, in the day-to-day parlance of the Capitol, these bills are known as being “dead.”

    AB 5 (Gonzalez D) Mandates certain hiring requirements for businesses.

    AB 199 (Chu D) Applied prevailing wage to private construction (not, this bill is not dead but has been amended in a manner that we no longer oppose).

    AB 378 (Garcia, Cristina D) California Cap-and-Trade on Greenhouse Gases.

    AB 909 (Steinorth R) Mandates that trauma kits be installed in private buildings.

    AB 975 (Friedman D) Greatly expands wild and scenic rivers designations.

    AB 1059 (Gonzalez Fletcher D) Attempts to Bans Dual agency commercial real estate firms/transactions.

    AB 1506 (Bloom D) Residential rent control: Costa-Hawkins Rental Housing Act.

    SB 2 (Atkins D) Applies a $75 tax to all recorded real estate documents.

    SB 224 (Jackson D) Overturns recent CEQA court.

    SB 640 (Hertzberg D) Sales tax on services.

    SB 705 (Allen D) Solid waste: expanded mandate on certain packaging.

    SB 775 (Wieckowski D) California Cap-and-Trade on Greenhouse Gases.

    Jun 2


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    The bad news is that many bills our industry opposed and were deemed as high priorities have passed the first house and are continuing to move.

    AB 73 (Chiu D) Planning and zoning: sustainability districts.

    AB 354 (Calderon D) Institutional Property Investors.

    AB 450 (Chiu D) Immigration worksite enforcement actions.

    AB 890 (Medina D) Bans local land use initiatives and takes away local control.

    AB 1127 (Calderon D) Mandates Baby diaper changing stations.

    AB 1667 (Friedman D) Adds burdensome water management planning.

    AB 1701 (Thurmond D) Original Contractor Labor-related liabilities.

    SB 49 (De León D) Tries to pre-empt certain environmental activities by the federal government.

    SB 63 (Jackson D) Expands parental leave mandates.

    SB 100 (De León D) Requires 100% renewable energy in the State.

    SB 150 (Allen D) Regional transportation plans.

    SB 231 (Hertzberg D) Adds potentially burdensome fees and charges for property infrastructure.

    SB 258 (Lara D) Cleaning Product Right to Know Act of 2017.

    SB 562 (Lara D) Single Payer Healthcare for California.

    Jun 2


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    In a stunning vote, especially since it was on the same day that President Trump announced that the U.S. would not participate in the Paris Climate Agreement a divided Democrat Caucus failed to move forward a key Climate Change bill related to re-authorizing California’s own rules:

    Above and beyond just extending the state’s current cap-and-trade program focused on carbon emissions beyond 2020, AB 378 (Garcia D) also expanded the program to include new restriction on air pollutants and potential limits on industrial facilities. Business groups strongly opposed the expansion of the program, as did the Republican Caucus and the Moderate Democrat Caucus, who hung together to reject the bill.

    In an unusual move, the vote tally was held open for almost 45 minutes as legislative leaders tried to pry the Mods apart and get them to support the measure.  Additional votes never materialized and the bill died on a final vote of 34 ayes and 39 noes.

    The fight, however, is far from over.  The Governor and Legislative Leaders have placed a very high priority on re-authorizing cap-and-trade and its expected a late session push will happen in August and/or September.

    We are asked a lot about why the commercial real estate industry cares so much about this issue as it is seen as something that primarily impacts industrial facilities and trucking.  Its about much more than that and ultimately impacts every one of your buildings through higher energy costs (electrical, natural gas, and gasoline) and is driving the extremely strict building codes that are driving up the costs of your new construction and tenant improvements.

    This article by our friends John Gamboa and Jennifer Hernandez is one of the most enlightening articles you can read on this topic and we highly recommend it to you. Click here to read the full article.

    Jun 2


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    Some of you may remember that one of the biggest blow ups our industry has seen recently was the over-reach of the last set of lighting regulations.  Some buildings were seeing their tenant improvement costs more than triple because of the onerous rules that were put into place.  Although we were able to get the regulations corrected, the fact that they were adopted in the first place is due, partially, because our industry didn’t spend the time and effort to fully analyze the proposals before they were applied to your projects.

    We hope to avoid that situation moving forward and in addition to some technical consulting help we have brought on for this cycle, we hope that you will also help by participating in the process and asking technical experts that you work with to review proposals and get us feedback on anything that appears to be onerous, unimplementable, or not cost effective.

    With that below are two upcoming workshops that are important.

    Jun 2


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    Nonresidential Lighting Measures for the 2019 Standards California Energy Commission staff will conduct a workshop to gather stakeholder input on the development of the 2019 Building Energy Efficiency Standards (Standards). The workshop will be held on: Thursday, June 22, 2017 9:00 a.m. at the California Energy Commission.

    This is the fifth 2017 pre-rule making staff workshop for the 2019 Standards update and will focus specifically on nonresidential lighting measures. Multiple lighting measures will be presented and discussed, including measures for indoor lighting sources, indoor lighting controls, lighting alterations, advanced daylighting design, outdoor light sources, and outdoor lighting controls.  Click here for more information, including how to participate via the web.

    Jun 2


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    California Energy Commission staff will conduct a workshop to gather stakeholder input on residential and nonresidential indoor air quality and heating, ventilation and air conditioning (HVAC) measures for the 2019 Standards California Energy Commission.  If your building has air conditioning or heating, these regs have the potential of impacting your tenant improvement costs and input from industry experts is needed.

    This staff workshop is for 2019 Building Energy Efficiency Standards. The workshop will be held on: Tuesday, June 6, 2017 9:00 a.m. at the energy commission and online participation is available (see link below). Staff will accept oral comments during the workshop – if we get feedback from members on these measures we will be there in person to provide comments.  Please let us know. Click here for all the information.

    Jun 2


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    In response to legislation passed in 2015, the Division of the State Architect (DSA) has put together a working group to craft building standards for adult changing facilities in “commercial places of public entertainment”.  Specifically, AB 662 (Bonilla) requires a commercial place of public amusement with a daily occupancy greater than 2,500 people to have at least one adult changing table located in an enclosed bathroom.  The statute defines “commercial place of public amusement” as an auditorium, convention center, cultural complex, exhibition hall, permanent amusement park, sports arena, or theatre or movie house having a maximum occupancy greater than 2,500 people.   Earlier this week, DSA conducted the second of six planned working group meetings that will focus on various issues which must be addressed prior to DSA proceeding with the adoption of building standards that must take effect on January 1, 2020.  CBPA and BOMA have representatives on this working group.